IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
FU-CHENG CHEN , No. 85333-3-I Appellant, DIVISION ONE v. UNPUBLISHED OPINION FUKUEN ERIC CHEN and MING-FEN CHEN, and their marital community; JASON TIE-JAY CHEN, a single person, and FKC LAND, LLC, a Washington limited liability company,
Respondents.
CHUNG, J. — Fu-Cheng Chen sued Eric Chen, one of his two brothers, to
enforce a contract that all three brothers signed regarding the distribution of
family property. The trial court dismissed with prejudice Fu-Cheng’s breach of
contract claim for failure to name a necessary party, his third brother. After a
bench trial, the court dismissed Fu-Cheng’s claim for a resulting trust arising from
a quitclaim deed he executed in 1995 transferring property in Illinois to his
nephew. Because the court erred by failing to determine whether joinder was
feasible, as CR 19 requires, we reverse the court’s dismissal of the breach of
contract claim with prejudice. We also reverse the court’s order awarding fees to
Eric as the party prevailing on the breach of contract claim. We affirm the court’s
dismissal of the resulting trust claim and remand for further proceedings
consistent with this opinion. No. 85333-3-I/2
FACTS
Fu-Cheng is the oldest of three Chen brothers. Fu-Cheng and the middle
brother, Eric, both moved to the United States, while the youngest, Kuan-Ming,
lives in Taiwan.
From 1970 until 2011, the Chens’ father bought real estate for them, a
total of 98 separate properties in Taiwan and the United States. While their
father’s name did not appear on the titles, he was in control and made all the
decisions about what properties to buy and sell. He titled these properties in his
sons’ names, and he alone decided whose name to put on which titles and in
what proportion. Most of the properties are titled in the name of one son only, but
more than a dozen U.S. properties are titled in both Fu-Cheng and Eric’s names,
and one U.S. property is titled in the names of all three brothers. Most of the U.S.
properties are located in Washington State, with others in Illinois, Indiana,
Arkansas, Texas, and California.
In 1988, the father bought 336 acres of farmland in Illinois from the Blum
family, the “Blum Farm,” for $2.4 million. The seller’s warranty deed conveyed a
60 percent interest in the property to Eric and 40 percent to Fu-Cheng. At that
time, Fu-Cheng lived in Taiwan and was not a U.S. citizen. In 1995, Eric learned
an Illinois law might impose a substantial penalty on agricultural property owned
by a non-U.S. citizen for more than six years. Eric told their father and Fu-Cheng
that there were two choices: place the property in a trust or title the property in
the name of Eric’s son, Jason, who was a U.S. citizen. Because Eric thought it
was not clear whether a trust would be safe, Fu-Cheng decided on the other
2 No. 85333-3-I/3
option, and executed a quitclaim deed conveying “all” his interest in Blum Farm
to Jason, who was seven years old at the time.
After Fu-Cheng deeded his interest in Blum Farm to Jason in 1995, the
Chens’ father acquired five Washington properties and titled all five solely in Fu-
Cheng’s name. In 2001, Blum Farm sold for more than $16 million. The proceeds
were used as part of a 1031 exchange; 1 Eric created FKC Land, LLC, with
himself and Jason as its members, and the company acquired 11 properties in
Washington State with the proceeds from the sale of Blum Farm. Two of the 11
properties FKC Land acquired were sold to it by Fu-Cheng. Eric took a $1.5
million distribution from the sale proceeds. Also, after the sale of Blum Farm in
2001, Fu-Cheng’s father acquired seven properties in Taiwan and titled them
solely in Fu-Cheng’s name.
The brothers’ father suffered a stroke in 2010. As he recovered, he
directed his sons to memorialize his wishes that the properties he acquired and
titled in their names should be “re-register[ed]” with 30 percent for Fu-Cheng, 40
percent to Eric, and 30 percent to Kuan-Ming. The brothers did so by signing the
Family Asset Distribution Agreement (FADA) in 2011. The next week, the
brothers and Jason, signed a memorandum (2011 Memorandum) that clarified
which properties were in the scope of the FADA and which were not. The 2011
Memorandum also clarified that the ownership of U.S. property in the scope of
the FADA is 30 percent for each brother and 10 percent for Jason. Finally, in
1 See 26 U.S.C. § 1031 (allowing postponement of payment of tax on gain upon sale of
property if proceeds from sale are reinvested in a similar property as part of a like-kind exchange).
3 No. 85333-3-I/4
2013, Fu-Cheng and Eric, their wives, and Jason signed an agreement (2013
Agreement) to form a U.S. company to hold the Chen family’s properties in the
U.S. and distribute shares in that company in a “3:3:3:1” ratio. Unlike the FADA
and 2011 Memorandum, Kuan-Ming did not sign the 2013 Agreement.
The brothers’ father recovered from his stroke but passed away in 2016.
The next year, the brothers began arguing about implementing the FADA. In
November 2020, Fu-Cheng sued Eric, Eric’s wife, and Jason, for a 40 percent
interest in Eric and Jason’s company, FKC Land, LLC. Fu-Cheng alleged several
claims, including that the intent of the parties was to entrust Eric and Jason with
assets for Fu-Cheng’s benefit, and Fu-Cheng was entitled to an equitable
resulting trust. In January 2021, Fu-Cheng amended his complaint and reduced
his claim to 30 percent of the land company. Eric answered for all defendants in
March, and in May he moved to dismiss for failure to join an indispensable party,
his brother Kuan-Ming. The court denied Eric’s 2 motion but ordered that Fu-
Cheng “shall file a motion to file an amended complaint as discussed on the
record no later than July 9, 2021.”
In July 2021, Fu-Cheng moved to amend. His second amended complaint
joined FKC Land, but not Kuan-Ming. It asserted claims for breach of contract
and specific performance, declaratory judgment, and other claims in addition to a
resulting trust.
In September 2022, Eric moved to dismiss with prejudice because Fu-
Cheng’s attorneys withdrew and he failed to comply with the court’s scheduling
2 Hereinafter, “Eric” refers to all the defendants collectively.
4 No. 85333-3-I/5
order. New attorneys for Fu-Cheng entered a limited appearance in October
2022 and argued for a continuance, which the court granted until January 2023.
On the first day of trial in January 2023, Fu-Cheng moved to voluntarily
dismiss the bulk of his claims, leaving for trial the contract claim and the resulting
trust claim, and the court granted the motion. 3 Fu-Cheng claimed that if the
FADA was enforceable, he was due both specific performance and damages
from its breach, and if it was not enforceable, that a resulting trust arose when he
quitclaimed his interest in Blum Farm to Jason.
In February 2023, after Fu-Cheng rested his case-in-chief, Eric moved for
judgment as a matter of law on both claims. The court found that Fu-Cheng
conceded specific performance “was impossible without Kuan-Ming being a
party.” It concluded that Kuan-Ming was a necessary party and dismissal of Fu-
Cheng’s “breach of contract claim for failure to name a necessary party is
proper,” and it dismissed the contract claim.
The court then granted Eric’s motion to dismiss the jury, and it proceeded
with a bench trial on Fu-Cheng’s claim for an equitable resulting trust. The court
concluded Fu-Cheng “failed to prove by clear and convincing evidence that, at
the time he quit claimed the property to Jason, Fu-Cheng intended to retain for
himself personally a 40% equitable interest in Blum Farm,” and it dismissed the
claim with prejudice. The court also concluded that as a matter of equity, Fu-
Cheng had been compensated with properties in Washington State and Taiwan
3 The claims Fu-Cheng voluntarily dismissed were for conversion, breach of fiduciary
duty, unjust enrichment, accounting, and constructive trust. The court dismissed those claims without prejudice.
5 No. 85333-3-I/6
for the transfer of his interest in Blum Farm. Further, on the contract claim, which
had been previously dismissed, the court concluded that Eric was the prevailing
party and could seek attorney fees.
Fu-Cheng moved the court to reconsider the conclusion that Eric had
prevailed on the breach of contract claim. He argued that the court had not
dismissed that claim with prejudice and had never concluded the FADA was
enforceable, only that Kuan-Ming was a necessary party. Fu-Cheng argued he
“can, and will, file another action and name Kuan-Ming” as a party. 4 In May 2023,
the court denied reconsideration “except that the Court now clarifies its
February 8, 2023, CR 50(a) Order dismissing Plaintiff’s Breach of Contract Claim
WITH PREJUDICE.” The court determined that Fu-Cheng’s “failure to join
Kuan[-]Ming Chen warrants a dismissal with prejudice, whether or not it was
feasible to join Kuan[-]Ming Chen.” Separately, the court awarded attorney fees
and costs to Eric. In May 2023, Fu-Cheng timely appealed.
DISCUSSION
Fu-Cheng assigns error to the court’s orders granting Eric’s motion for
judgment as a matter of law and dismissing the contract claim with prejudice,
based on failure to join a necessary party, and denying reconsideration thereof.
He also assigns error to the court’s findings and conclusions on the resulting trust
claim and its order awarding Eric attorney fees and costs.
4 According to Eric, Fu-Cheng subsequently filed a complaint in King County Superior
Court naming Kuan-Ming and Eric, their spouses, Jason, and FKC Land as defendants.
6 No. 85333-3-I/7
I. Dismissal of Fu-Cheng’s contract claim with prejudice
The court dismissed Fu-Cheng’s contract claim because Fu-Cheng failed
to join a necessary party, Kuan-Ming. Fu-Cheng argues the trial court erred by
dismissing the claim with prejudice because it “failed to follow the three-step
analysis set forth in CR 19,” and because “CR 19(a) does not afford the trial court
discretion to dismiss the action without first deciding whether joining Kuan-Ming
was feasible.” Eric counters that Fu-Cheng bore the burden of proof to show that
Kuan-Ming was not a necessary party, Eric also contends that failing to join
Kuan-Ming as a party was Fu-Cheng’s choice and constituted inexcusable
neglect, that joinder after trial is not feasible, and that any error cannot be raised
for the first time on appeal and was invited error. We conclude that because the
trial court did not first find that joining Kuan-Ming was not feasible under CR
19(a), it erred by conducting an analysis under CR 19(b) and dismissing the
contract claim with prejudice.
We review a motion for a judgment as a matter of law “in the same
manner as the trial court.” Johnson v. Liquor & Cannabis Bd., 197 Wn.2d 605,
611, 486 P.3d 125 (2021). Granting the motion is appropriate if “ ‘viewing the
evidence most favorable to the nonmoving party, the court can say, as a matter
of law, there is no substantial evidence or reasonable inference to sustain a
verdict for the nonmoving party.’ ” Id. at 611 (quoting Sing v. John L. Scott, Inc.,
134 Wn.2d 24, 29, 948 P.2d 816 (1997)). 5
5 Fu-Cheng concedes the proper standard of review for the CR 50 motion is de novo. In
its order denying Fu-Cheng’s CR 59 motion for reconsideration, the court clarified that its CR 50(a) order dismissing Fu-Cheng’s breach of contract claim was with prejudice. Generally, we review a CR 59 motion for abuse of discretion, but where, as here, the motion sought review for
7 No. 85333-3-I/8
CR 19 addresses when the joinder of absent persons is needed for a just
adjudication. Auto. United Trades Org. v. State, 175 Wn.2d 214, 221, 285 P.3d
52 (2012). The rule states in relevant part:
(a) Persons to Be Joined if Feasible. A person who is subject to service of process . . . shall be joined as a party in the action if (1) in the person’s absence complete relief cannot be accorded among those already parties, or (2) the person claims an interest relating to the subject of the action and is so situated that the disposition of the action in the person’s absence may (A) as a practical matter impair or impede the person’s ability to protect that interest or (B) leave any of the persons already parties subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations by reason of the person’s claimed interest. If the person has not been so joined, the court shall order that the person be made a party. If the person should join as a plaintiff but refuses to do so, the person may be made a defendant, or, in a proper case, an involuntary plaintiff. If the joined party objects to venue and the person’s joinder would render the venue of the action improper, the joined party shall be dismissed from the action.
(b) Determination by Court Whenever Joinder Not Feasible. If a person joinable under (1) or (2) of section (a) hereof cannot be made a party, the court shall determine whether in equity and good conscience the action should proceed among the parties before it, or should be dismissed, the absent person being thus regarded as indispensable. The factors to be considered by the court include: (1) to what extent a judgment rendered in the person’s absence might be prejudicial to the person or those already parties; (2) the extent to which, by protective provisions in the judgment, by the shaping of relief, or other measures, the prejudice can be lessened or avoided; (3) whether a judgment rendered in the person’s absence will be adequate; (4) whether the plaintiff will have an adequate remedy if the action is dismissed for nonjoinder.
CR 19 (emphasis added).
To determine whether joinder is needed for a just adjudication, a court
engages in a three-step analysis: it determines (1) whether the absent party is
necessary, (2) whether joinder is feasible, and, (3) if joinder is not feasible,
an error of law, review is de novo. Schneider v. City of Seattle, 24 Wn. App. 251, 255, 600 P.2d 666 (1979).
8 No. 85333-3-I/9
whether the action should still proceed without the party. Auto. United Trades
Org., 175 Wn.2d at 221-22. Under CR 19(a), a necessary party is a party whose
absence from the proceedings would prevent the trial court from affording
complete relief to the existing parties or a party whose absence would either
impair the absent party’s interest or subject an existing party to inconsistent or
multiple liability. Coastal Bldg. Corp. v. City of Seattle, 65 Wn. App. 1, 4-5, 828
P.2d 7 (1992).
Generally, when a necessary party has not been joined, dismissal should
be without prejudice. Orwick v. Fox, 65 Wn. App. 71, 82 n.6, 828 P.2d 12 (1992).
But if a court determines that an absent party is a necessary party under CR
19(a) but the party cannot be joined, i.e., joinder is not feasible, then the court
must decide whether “in equity and good conscience the action should proceed
among the parties before it, or should be dismissed, the absent person being
thus regarded as indispensable.” CR 19(b). Determining indispensability “is
rooted in equitable principles” and depends on “ ‘pragmatic considerations.’ ”
Auto. United Trades Org., 175 Wn.2d at 227, 228 (quoting Provident
Tradesmens Bank & Tr. Co. v. Patterson, 390 U.S. 102, 107, 88 S. Ct. 733, 19 L.
Ed. 2d 936 (1968)). “Whether a person is ‘indispensable,’ . . . can only be
determined in the context of particular litigation.” Provident Tradesmens Bank,
390 U.S. at 118. Only if the court has analyzed the factors in CR 19(b) and
determined that the absent party is indispensable may it dismiss the action with
prejudice.
9 No. 85333-3-I/10
Under CR 19, “[t]he party urging dismissal bears the burden of
persuasion.” Auto. United Trades Org., 175 Wn.2d at 222. However, if it appears
from “ ‘an initial appraisal of the facts’ ” that there is an unjoined indispensable
party, “ ‘the burden devolves on the party whose interests are adverse to the
unjoined party to negate this conclusion[,] and a failure to meet that burden will
result in the joinder of the party or dismissal of the action.’ ” Id. (quoting 7
CHARLES ALAN W RIGHT ET AL., FEDERAL PRACTICE & PROCEDURE § 1609, at 130
(2001)).
Here, initially Eric bore the burden of persuasion that joinder of Kuan-Ming
was necessary. Eric first raised this issue in May 2021 in a CR 12(b)(7) pre-trial
motion seeking dismissal, arguing that FKC Land and Kuan-Ming were
indispensable parties under CR 19. Fu-Cheng responded that Kuan-Ming’s
interests were not “in any way impacted” because the property at issue was “the
300 acres of Illinois property, that became the property that’s held currently by
FKC Land,” which Eric and Jason owned. At the hearing on the motion, the court
stated the question before it was “whether in equity and good conscience an
action should proceed without those indispensable parties,” referring to both FKC
Land and Kuan-Ming. The court noted its concern about dismissing based on the
absence of an indispensable party but reasoned it might be possible to shape
any potential relief without prejudice to Kuan-Ming. The court also stated at the
hearing that “it would be valuable to have FKC as a party” and that it would
“simplify these arguments if there is an amendment” to add FKC Land. In a
subsequent written order, the court denied Eric’s motion to dismiss and ordered
10 No. 85333-3-I/11
Fu-Cheng to file a motion to amend the complaint “as discussed on the record.”
Accordingly, Fu-Cheng filed a second amended complaint joining FKC Land as a
defendant, but he did not join Kuan-Ming. 6
Eric did not raise the issue of joinder again until nearly two years later. In
February 2023, after Fu-Cheng rested his case in chief at trial, Eric moved for
judgment as a matter of law because “Kuan[-Ming] is necessary for the
enforcement of any contract.” The court granted the motion and dismissed the
contract claim for failure to name a necessary party, without specifying whether
the dismissal was with or without prejudice. The court concluded that Kuan-Ming
“[wa]s a necessary party for the enforcement of the 2011 FADA, 2011
Memorandum, and the 2013 Agreement which require the division of and re-
titl[]ing of property in Washington State and Taiwan currently titled to Kuan[-]
Ming.” Fu-Cheng does not challenge the court’s conclusion as to the first step of
the CR 19 three-step analysis, that Kuan-Ming was a necessary party.
The next step is to determine whether joinder of the absent necessary
party, Kuan-Ming, was feasible. But the court’s order granting Eric’s CR 50
motion did not address feasibility. Not until later, in its order denying Fu-Cheng’s
motion for reconsideration, did the court discuss feasibility. In that motion, Fu-
Cheng asked the court to reconsider its conclusion that Eric was the prevailing
6 Later, at trial, Fu-Cheng’s counsel, who had entered an appearance after Fu-Cheng’s
initial attorneys had withdrawn, explained why he had not attempted joinder earlier. He stated his “understanding was if I were to file a leave to amend, it would have been summarily denied, and it was pled how it was pled.” The court had granted Fu-Cheng’s new counsel a continuance until January 2023 but ruled that “[d]iscovery is closed.” The court reasoned that to reopen discovery would be a prejudice to Eric.
11 No. 85333-3-I/12
party on the contract claim. Fu-Cheng argued the court had not dismissed his
claim with prejudice or reached the merits of whether the FADA was enforceable.
The court’s order denying reconsideration “clarifi[ed]” that its prior
dismissal of the contract claim was with prejudice. The court explained that
whether or not it was feasible to join Kuan-Ming, the failure to join him
“warrant[ed] a dismissal with prejudice.” Its order noted that neither party asked
the court to determine feasibility “and the record is insufficient for the Court to
make this finding.” The court proceeded to consider both alternatives—that is,
first, it assumed joinder was not feasible and, second, it assumed joinder was
feasible. Addressing the first alternative, the court noted that “[i]f Kuan-Ming
Chen is not subject to process and could not be joined in this action, the Court
must apply CR 19(b) to determine whether in equity and good conscience an
action should proceed.” Applying the CR 19(b) factors, the court concluded that
enforcing the FADA was “impossible” without Kuan-Ming as a party. The court
then addressed the other alternative, “if Kuan-Ming Chen were subject to process
and could have been joined,” and concluded that in that case, Fu-Cheng’s failure
to join him was inexcusable neglect. The parties disagree as to whether the trial
court erred by failing to determine whether it was feasible to join Kuan-Ming
before proceeding to consider under CR 19(b) whether the action could still
proceed without him.
Fu-Cheng compares his case to Orwick, in which the trial court dismissed
Orwick’s tort claims under CR 19 with prejudice, but “entered no findings as to
whether [the absent parties] were necessary parties or indispensable parties and
12 No. 85333-3-I/13
did not order that they be joined, but simply dismissed plaintiffs’ action citing CR
12(b)(6) and CR 19.” 65 Wn. App. at 77, 80, & 82 n.6. The Orwick court
reasoned that “this alone”—i.e., the trial court’s failure to enter findings—was an
abuse of its discretion because dismissal with prejudice under CR 19(b) requires
“a clear determination” than an absent party “is both necessary and
indispensable.” Id. at 80.
We agree with Fu-Cheng that CR 19 requires the court to determine
whether joinder is feasible. Subsection (a) of CR 19 is entitled “Persons to Be
Joined if Feasible.” It states that “[a] person who is subject to service of process
and whose joinder will not deprive the court of jurisdiction over the subject matter
of the action shall be joined as a party” under certain circumstances that show
that they are necessary to the action. CR 19(a) (emphasis added); Coastal Bldg.
Corp., 65 Wn. App. at 4-5 (a necessary party is a party whose absence from the
proceedings would prevent the trial court from affording complete relief to the
existing parties or a party whose absence would either impair the absent party’s
interest or subject an existing party to inconsistent or multiple liability). And, if a
necessary party has not been joined, “the court shall order that the person be
made a party.” CR 19(a) (emphasis added). “Shall” is mandatory language. See,
e.g., Pub. Util. Dist. No. 1 of Lewis County v. Wash. Pub. Power Supply Sys.,
104 Wn.2d 353, 368, 705 P.2d 1195 (1985) (“the term ‘shall’ is directory”).
Despite having determined Kuan-Ming was a necessary party, here, the court
failed to determine if his joinder was feasible. To the contrary, it concluded “the
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record is insufficient for the Court to make this finding [as to feasibility].” As a
result, the court issued no order requiring that Kuan-Ming be joined as a party. 7
As the title of CR 19(b) indicates, this subsection governs
“Determination[s] by Court Whenever Joinder Not Feasible.” Thus, according to
the plain language of the rule, a prerequisite to the analysis under CR 19(b) is a
finding that joinder is not feasible. Even if, as the court noted, neither party here
asked for a determination of feasibility, CR 19 requires this analysis. The court
erred by failing to determine whether joinder was feasible before applying CR
19(b). 8
Eric argues that because Fu-Cheng did not request the court to determine
whether or not it was feasible to join Kuan-Ming below, he cannot argue on
appeal that the court erred by not determining feasibility, and this is invited error.
“Under the invited error doctrine, ‘a party may not set up an error at trial and then
complain of it on appeal.’ ” Shavlik v. Dawson Place, 11 Wn. App. 2d 250, 270,
452 P.3d 1241 (2019) (quoting Grange Ins. Ass’n v. Roberts, 179 Wn. App. 739,
774, 320 P.3d 77 (2013)). “The doctrine applies when a party takes ‘affirmative
and voluntary action’ that induces the trial court to take an action later challenged
on appeal.” Id. (quoting Grange Ins. Ass’n, 179 Wn. App. at 774).
7 As discussed above, its pretrial order denying Eric’s CR 12(b)(7) motion to dismiss
required Fu-Cheng to amend the complaint “as discussed on the record,” and the discussion at the hearing focused on FKC as a necessary party, leaving open the question of whether Kuan- Ming was a necessary party. Thus, CR 19 did not require the court at that point to issue an order requiring his joinder. 8 The court also concluded that “if Kuan[-]Ming were subject to process and could have
been joined,” Fu-Cheng’s failure to join him was inexcusable neglect. This conclusion was an alternative conclusion that assumed feasibility, so we need not address the parties’ arguments as to whether this conclusion was error.
14 No. 85333-3-I/15
Fu-Cheng did not take any affirmative voluntary act that induced the trial
court’s action, or inaction, at issue. Rather, Fu-Cheng consistently argued Kuan-
Ming was not necessary to his breach of contract claim. He eventually had to
concede that position, but his concession did not induce the trial court to fail to
determine feasibility. Moreover, it was not until the court issued its order denying
reconsideration that the court “clarified” that it was not simply dismissing so that
Fu-Cheng could join Kuan-Ming as a party, but dismissing the contract claim with
prejudice. In the order denying Fu-Cheng’s motion for reconsideration, the court
explicitly mentioned feasibility for the first time and decided it could not decide
that issue. Thus, Fu-Cheng had no reason, or opportunity, to raise the court’s
failure to address feasibility prior to that order.
As we conclude the court erred by failing to engage in the second step of
determining feasibility, we reverse the court’s dismissal of Fu-Cheng’s contract
claim. On remand, in accordance with CR 19(a), the court shall order that Kuan-
Ming be made a party. Only if the court determines that it is not feasible 9 to join
Kuan-Ming may it proceed to analyze the third step under CR 19(b), whether the
action should still proceed without Kuan-Ming. 10
9 While the definition of “feasible” is a question of law, feasibility is generally a question of
fact. Kelley v. Centennial Contractors Enters., Inc., 169 Wn.2d 381, 386, 387-88, 236 P.3d 197 (2010) (holding that “feasible” has “its plain and ordinary meaning as set forth in Webster’s” dictionary: “ ‘capable of being done, executed, or effected: possible of realization . . . capable of being managed, utilized, or dealt with successfully: SUITABLE . . . REASONABLE’ ” (quoting W EBSTER’S THIRD NEW INTERNATIONAL DICTIONARY 831 (2002))). Fu-Cheng argues that the parties do not dispute that Washington State property is titled in Kuan-Ming’s name and, by having Washington State property titled in his name, Kuan-Ming consents to personal jurisdiction. See RCW 4.28.185(1)(c). RCW 4.28.180 allows for personal service out of state. As this argument is related to feasibility to be determined on remand, we do not address it here. 10 Fu-Cheng “presum[es]” the trial court dismissed his claim for a declaratory judgment
that the FADA was enforceable and argues that this dismissal, too, was improper. Although the court granted Eric fees for “defending the FADA” and for “FADA enforcement,” neither the court’s
15 No. 85333-3-I/16
II. Dismissal of Fu-Cheng’s resulting trust claim
After it dismissed Fu-Cheng’s contract claim, the court granted Eric’s
motion to dismiss the jury, and it proceeded with a bench trial on the claim of a
resulting trust. The court’s written findings and conclusions found Fu-Cheng
conveyed “all” his 40 percent interest in Blum Farm to Jason. The court
concluded “Fu-Cheng failed to prove by clear cogent and convincing evidence
that, at the time he quit claimed the property to Jason, Fu-Cheng intended to
retain for himself personally a 40% equitable interest in Blum Farm.” The court
also concluded that Fu-Cheng “has been compensated for such transfer” by the
properties his father purchased for him alone in Washington State and Taiwan
and dismissed the equitable claim of resulting trust.
Fu-Cheng claims the court erred by concluding he failed to provide clear,
cogent, and convincing evidence that, at the time he quitclaimed his interest in
Blum Farm to Jason, he “personally” intended to retain a beneficial interest in
Blum Farm. Eric argues the quitclaim deed Fu-Cheng executed in Jason’s favor
“cannot create a resulting trust” legally and, even if it could, as an equitable
matter, their father purchased additional properties titled in Fu-Cheng’s name
alone “to compensate” him. We agree with Eric.
“A resulting trust arises where a person makes or causes to be made a
disposition of property under circumstances which raise an inference that he
does not intend that the person taking or holding the property should have the
beneficial interest in the property.” Engel v. Breske, 37 Wn. App. 526, 528-29,
CR 50 order nor the order denying reconsideration expressly dismissed or addressed the claim for declaratory relief.
16 No. 85333-3-I/17
681 P.2d 263 (1984) (quoting 5 A. Scott, Trusts § 404.1, at 3213 (3d ed. 1967)).
In other words, “ ‘[w]hen title to property is taken in the name of a grantee other
than the person advancing the consideration, the one in whose name title is
taken is a resulting trustee for the person who paid the purchase price, in the
absence of evidence of a contrary intent.’ ” In re Est. of Spadoni, 71 Wn.2d 820,
822, 430 P.2d 965 (1967) (quoting Donaldson v. Greenwood, 40 Wn.2d 238,
249, 242 P.2d 1038 (1952)).
“An essential element of a resulting trust is that there be an intent that the
beneficial interest in property not go with the legal title. By definition, this intent is
not express but may be inferred from the terms of the disposition or from the
accompanying facts and circumstances.” Engel, 37 Wn. App. at 529 (citing Lalley
v. Lalley, 43 Wn.2d 192, 196, 260 P.2d 905 (1953)). Where the person asserting
the trust “paid the consideration for the property, a presumption arises that a trust
exists . . . , absent evidence of a contrary intent.” Engel, 37 Wn. App. at 529. But
where the person asserting the trust “does not furnish all of the consideration for
the property, no presumption . . . arises [and] the person asserting the trust has
the burden of proving its existence by clear, cogent and convincing evidence.” Id.
This evidence may include parol evidence. Spadoni, 71 Wn.2d at 823.
When, as here, findings of fact and conclusions of law are entered
following a bench trial, appellate review is limited to determining whether the
findings are supported by substantial evidence, and if so, whether the findings
support the trial court’s conclusions of law and judgment. Sunnyside Valley Irrig.
Dist. v. Dickie, 111 Wn. App. 209, 214, 43 P.3d 1277 (2002) (citing Holland v.
17 No. 85333-3-I/18
Boeing Co., 90 Wn.2d 384, 390-91, 583 P.2d 621 (1978)). Evidence is
substantial if it is sufficient to persuade a fair-minded person that the declared
premise is true. Sunnyside Valley Irrig. Dist., 111 Wn. App. at 214 (citing Nguyen
v. Dep’t of Health, Med. Quality Assurance Comm’n, 144 Wn.2d 516, 536, 29
P.3d 689 (2001), cert. denied, 535 U.S. 904, 122 S. Ct. 1203, 152 L. Ed. 2d 141
(2002)). Because Fu-Cheng fails to assign error to any particular finding of fact,
the court’s findings are verities on appeal. See Cowiche Canyon Conservancy v.
Bosley, 118 Wn.2d 801, 808, 828 P.2d 549 (1992). Our review is limited to
determining whether the findings support the trial court’s conclusions of law.
First, at closing argument below, Fu-Cheng clarified that the relief he
sought was a resulting trust in 30 percent of the $1.5 million in excess cash
distributed from FKC Land to Eric after the sale of Blum Farm and acquisition of
Washington properties in the 1031 exchange. Fu-Cheng cannot now resuscitate
on appeal the argument he abandoned below, that he retains a “beneficial
interest in the Blum Farm.”
Second, the unambiguous language of the quitclaim deed Fu-Cheng
granted to Jason makes it clear that Fu-Cheng’s intent was to convey all of his 40
percent interest in Blum Farm; the Illinois statutory quitclaim deed “CONVEY(S)
and QUIT CLAIM(S) . . . all interest” in Blum Farm. See Newport Yacht Basin
Ass’n of Condo. Owners v. Supreme Nw., Inc., 168 Wn. App. 56, 67, 277 P.3d 18
(2012) (“the operative words of a quitclaim deed are ‘conveys and quitclaims.’ ”)
(quoting 18 W ILLIAM B. STOEBUCK & JOHN W EAVER, W ASHINGTON PRACTICE: REAL
ESTATE: TRANSACTIONS § 14.2, at 116 (2d ed. 2004)). A person conveying their
18 No. 85333-3-I/19
interest in a quitclaim deed is presumed to have transferred all their legal and
equitable interest in the property. RCW 64.04.050 (a quitclaim deed “shall be
deemed” to release and quitclaim to the grantee “all the then existing legal and
equitable rights of the grantor”).
Third, the facts do not support a presumption in favor of a resulting trust.
Here, while Fu-Cheng did convey all his interest in Blum Farm to Jason, that
interest was only 40 percent of Blum Farm; Eric had title to the other 60 percent.
Because Fu-Cheng did not furnish all the consideration for the property, the
presumption does not apply.
Fourth, even if the intent to create a resulting trust “may be inferred from
the terms of the disposition or from the accompanying facts and circumstances,”
Engel, 37 Wn. App. at 529, here, the court made no finding of an inference of
such intent. Fu-Cheng testified that Eric suggested either forming a trust or
quitclaiming Blum Farm to Jason, and that he chose to transfer his interest to
Jason: “So then I said, okay, we will transfer that to Jason.” The court made the
finding, unchallenged on appeal, “that Fu-Cheng made the decision to transfer
his 40% interest in the Blum Farm to Jason and that he signed this deed
voluntarily.”
Finally, a resulting trust is an equitable remedy. See Stocker v. Stocker,
74 Wn. App. 1, 6, 871 P.2d 1095 (1994) (resulting and constructive trusts are
equitable in nature and arise by implication of law). Here, Fu-Cheng does not
challenge the court’s findings that after he conveyed his interest in Blum Farm to
Jason, his father bought and titled solely in Fu-Cheng’s name five properties in
19 No. 85333-3-I/20
Washington State and after Blum Farm was sold, his father purchased seven
properties in Taiwan titled solely in his name. Thus, the court’s unchallenged
findings of fact support its conclusion that Fu-Cheng was equitably compensated
by his father for conveying his interest in Blum Farm to Jason, so there was no
need for the court to provide an equitable remedy.
III. Fees
In March 2023, the court concluded that Eric prevailed on the contract
claim and allowed him to apply for attorney fees and costs. In May 2023, it
granted Eric’s motion for fees and costs. Because we reverse the court’s order
dismissing the breach of contract claim, we reverse the court’s order granting
fees and costs to Eric as premature. For the same reason, the Respondents’
request for fees on appeal is denied.
CONCLUSION
We reverse the court’s dismissal of Fu-Cheng’s breach of contract claim.
We remand for the court to order the joinder of the necessary party, Kuan-Ming,
and to proceed in a manner consistent with CR 19 and this opinion. We affirm the
court’s dismissal with prejudice of Fu-Cheng’s claim for a resulting trust. Finally,
we reverse the court’s order awarding fees to Eric as the prevailing party with
respect to Fu-Cheng’s breach of contract claim.
Affirmed in part, reversed in part, and remanded.
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WE CONCUR: